Poste Italiane (PST) investor relations material

Deal rationale and strategic fit

• Aims to create Italy's leading integrated digital infrastructure platform, spanning connectivity, cloud, digital identity, financial, insurance, logistics, and telecommunications services, to accelerate national digital transformation and innovation.

• Culminates a nine-year platform strategy, leveraging complementary assets and unmatched digital and physical distribution to serve Italy’s largest client base and drive value creation.

• Strengthens critical infrastructure, supporting cloud sovereignty, data confidentiality, and digital evolution for public administration, enterprises, and the broader economy.

• Enhances diversification and resilience of revenue streams, optimizing technology investments and supporting digital sovereignty and economic productivity.

• Positions the combined entity as a leader in Italy’s digital and physical distribution, with sustainable growth and shareholder returns.

Financial terms and conditions

• Voluntary public exchange and cash offer for 100% of TIM ordinary shares, including those from savings share conversion, valuing each at €0.635 (€0.167 cash plus 0.0218 newly issued shares), representing a 9.01% premium.

• Total consideration is approximately €10.8 billion (€2.8 billion cash, €8 billion equity).

• Pro forma market cap estimated at €35–40 billion; 2025 pro forma revenues just below €27 billion; operating profit €4.8 billion, rising to €5.5 billion with synergies.

• EPS accretive from 2027, with double-digit accretion from 2028; 2026 dividend guidance confirmed.

• TIM shareholders will own about 22% of the enlarged entity post-transaction; intends to delist TIM shares from Euronext Milan.

Synergies and expected cost savings

• Identified annual pre-tax synergies of €0.7 billion: €0.5 billion from cost savings (central function consolidation, procurement, IT, marketing) and €0.2 billion from revenue synergies (cross-selling, upselling, digital services, cloud, cybersecurity, IoT).

• Synergies expected within two to three years post-completion; 50% of cost synergies targeted by 2027, remainder by 2028.

• Funding cost savings estimated at €50–100 million annually.

• One-off integration costs estimated at €0.7 billion, mainly in 2026–2027.

• Additional upside anticipated from institutional support and integration of digital infrastructure.